On the Move: Ethical duties when switching law firmsBy Helen Hierschbiel

Once upon a time, I am told, lawyers
would settle into a firm soon after graduation and
spend their entire careers at that firm. These days,
however, lawyer mobility seems to be the norm. Lawyers
are apt to move among various firms, between private
and government practice, or in and out of the practice
of law multiple times during the course of their careers.
Moving on invariably gives rise to ethical issues that
should be considered before even contemplating a change.
The duties vary somewhat depending on whether the move
is between firms or between private and government
practice. This column focuses on the former.1

Looking to Leave
A lawyer has an interview at a firm and is gearing
up to showcase her talents and experience with stories
of cases resolved and clients saved. Self-promotion
during an interview may be acceptable, but revealing
client confidences is not. While a lawyer may discuss
the general nature of cases handled, a lawyer may
not be able to disclose client names or the factual
or legal details of a particular case. See, Oregon
RPC 1.6; District of Columbia Formal Op No. 312 (2002).
Even when the prospective employer wants to check
for conflicts before extending an offer, client confidences
must be preserved. One option is to provide the prospective
employer with the names of opposing parties rather
than clients.

In addition to satisfying ethical obligations,
fiduciary obligations to partners or employers must
be considered prior to leaving the firm. "Although
there is no explicit rule requiring lawyers to be candid
and fair with their partners or employers, such an
obligation is implicit in the prohibition … against
dishonesty, fraud, deceit, or misrepresentation. Moreover,
such conduct is a violation of the duty of loyalty
owed by a lawyer to his or her firm based on their
contractual or agency relationship." In re
Complaint as to the Conduct of Murdock, 328 Or
18, 25 (1998), citing, In re Smith, 315 Or 260,
266 (1992). See also OSB Formal Op No 2005-70;
ABA Formal Op No 99-414; ABA/BNA Lawyers’ Manual
on Professional Conduct Section 91:707 (2005). Thus,
secretly attempting to lure firm clients to the new
firm by having them sign retainer agreements with the
lawyer rather than the firm, lying about the client’s
right to choose counsel, and taking client files or
money without the knowledge or consent of the employer
have been considered breaches of the lawyer’s
duty of loyalty to the employer that could result in
discipline. In re Smith, id. The departing
lawyer must also be careful about taking firm property,
including document forms and similar materials, except
with consent of the firm. See ABA Formal Op
No 99-414.

Leaving
After making the decision to leave and informing the
employer, lawyers have three primary ethical obligations
before moving on: 1) tell the clients; 2) let the
clients decide whether they go with you or stay at
the firm; and, 3) take appropriate steps to withdraw
when asked to do so. See OSB Formal Op No
2005-70; ABA Formal Op No 99-414; Oregon RPC 1.4
and 1.16(d).

As a general proposition, the departing
lawyer’s clients are clients of the firm, and
the firm may have an interest in retaining the clients.
On the other hand, particularly in smaller firms, the
firm may not be able to continue the representation
after the departure of the lawyer. Discussion of the
departing lawyer’s plans should include a decision
about which, if any, clients the firm is interested
in retaining and which the firm is willing to have
the departing lawyer take with her (assuming the clients
consent).

The preferred method for providing notice
to clients of a lawyer’s departure is by a joint
letter from the managing partner and the departing
lawyer to those clients with whom the departing lawyer
has had principal responsibility or significant contacts.
The letter should provide information about the departing
lawyer’s plans and indicate whether the firm
is capable of and interested in continuing the representation.
The letter must inform the clients that they may choose
to keep their work with the firm or engage the departing
lawyer. The letter should also inform clients, if they
choose the latter option, what they need to do to terminate
their relationship with the firm, including paying
any outstanding fees or costs and how to get a copy
of the file. The letter should be sent well enough
in advance of the departure to give clients time to
make their choices and lawyers time to take steps to
effect any transfers of cases.

Of course, an unfriendly separation may
make these best practices impossible. In such cases,
separate letters may be sent. ABA Formal Op No 99-414
recommends that a letter from the departing lawyer
should: 1) not urge the client to sever its relationship
with the firm, but may indicate the lawyer’s
willingness and ability to continue responsibility
for the matters upon which she currently is working;
2) make clear that the client has the ultimate right
to decide who will finish the case and 3) not disparage
the lawyer’s former firm. In addition, so long
as the letter is sent only to those clients with whom
the lawyer has a present professional relationship,
the lawyer does not violate RPC 7.3(a). See OSB
Formal Op No 2005-70.

Upon separation, client files and property
must be handled in accordance with the client’s
direction. ABA Formal Op No 99-414; Oregon RPC 1.15-1(e)
and 1.16(d). Generally, this means that if the client
decides to go with the departing lawyer, the firm should
surrender the client file2 to the departing
lawyer and transfer any unearned advance deposits to
the departing lawyer’s new trust account. Where
a case is being handled on a contingent fee basis,
fees will have to be apportioned. The decision on how
fees will be split does not need to comply with requirements
of RPC 1.5(e).

Settling In
When a lawyer becomes associated with a firm, former
client conflict questions should be handled in accordance
with 1.10(c). Where a former client conflict exists,
representation may continue either with the affected
parties’ informed consent, confirmed in writing
as per RPC 1.9, or by complying with the screening
process set forth in RPC 1.10(c). See also,
OSB Formal Op No 2005-128. A thorough screen will
include: 1) notification to all firm staff of the
screen; 2) locking the disqualified lawyer out of
the document database; 3) locking the disqualified
lawyer out of communication loop regarding the case;
4) periodic reminders to staff of the screen; 5)
written warning in the paper file stored in a secure
location, not the general file room. See Lynda
C. Shely, Law Firms Changes: The Ethical Obligations
When Lawyers Switch Firms, ABA 32nd National
Conference on Professional Responsibility Coursebook
(June 2006).

Once the lawyer is established in her
new practice she may solicit the clients that she represented
at the former firm. See, e.g., Oregon RPC 7.2(a)(2)
(allowing a lawyer to solicit personally former clients;
and Oregon RPC 7.2(c) (requirement that written solicitation
of a person known to be in need of legal service sin
a particular matter be labeled as an "advertisement" does
not apply to persons specified in 7.2(a)).

Conclusion
Changing firms gives rise to a several ethics issues
that should be considered as soon as a lawyer contemplates
leaving a firm. Duties of confidentiality, loyalty
and avoiding prejudice to clients serve as the framework
for answering questions of whom to tell about the
move, when, what to say and how. The possibility
of conflicts may ultimately determine whether the
move is feasible. Finally, the departing lawyer’s
contractual and fiduciary duties to the firm must
be considered, together with property issues involving
client files, documents, templates and forms.

ENDNOTES1 For guidance on moving between government
and private practice, see Oregon RPC 1.11 and
OSB Formal Op No 2005-120.

2 For discussion of what constitutes
the "client file," see OSB Formal
Op No 2005-125.

ABOUT THE AUTHORHelen Hierschbiel is deputy general counsel for the
Oregon State Bar. She can be reached at (503) 620-0222,
or toll-free in Oregon at (800) 452-8260, ext. 361,
or by e-mail at hhierschbiel@osbar.org.